In a latest development, Icelandic PM Sigmundur David Gunnlaugsson has resigned in wake of Panama Papers scandal.

Gunnlaugsson's resignation is the first major political casualty to emerge from the leak.

"The prime minister told (his party`s) parliamentary group meeting that he would step down as prime minister and I will take over," the Progressive party`s deputy leader and Agriculture Minister Sigurdur Ingi Johannsson told a live broadcast, as per AFP.

On the other hand, Pakistan Prime Minister Nawaz Sharif today formed a high-level judicial commission to probe any financial wrongdoing, a day after three of his children were named in the 'Panama Papers' for owning offshore companies prompting demands for an enquiry by the Opposition.

Addressing the nation, Sharif announced formation of the commission to probe allegations against him and his family.

"I hereby announce to form a judicial commission which will be led by a former judge of the Supreme Court. This commission will weigh the allegations being levelled and will give its verdict after due investigation," he said.

The judicial commission will be led by a retired Supreme Court judge, he added.

The Pak PM gave a detailed background of the businesses controlled by his family that he said were established many years before Pakistan was founded adding despite repeated efforts to ruin his business in the past, he and his family had paid outstanding amount of nearly Rs 6 billion.

"My family has faced a barrage of accusations. My family was not involved in politics till much later, as such, even before I got into politics, we were an established industrial family," he said, as per PTI.

"I want the nation to decide for themselves the reality behind these allegations which are being levelled for the last 25 years," he said.

He said his sons Hassan and Hussain were living in the UK and Saudi Arabia since 1994 and 2000 respectively and working under the legal ambit and rules.

Sharif also challenged all those hurling allegations against him and his family to present evidence of any financial wrongdoing before the commission.

Meanwhile, Spain, France and several other countries launched tax evasion probes after a massive leak of confidential documents lifted the lid on the murky offshore financial dealings of a slew of politicians and celebrities.

The scandal erupted yesterday when media groups began revealing the results of a year-long investigation into a trove of 11.5 million documents from the law firm Mossack Fonseca, which specialises in creating offshore shell companies in the tax haven of Panama.

Among those accused are close associates of Russian President Vladimir Putin, relatives of Chinese leader Xi Jinping, Iceland's Prime Minister Sigmundur David Gunnlaugsson as well as Barcelona striker Lionel Messi.

However, Putin's spokesman says the Russian President has no connection to offshore accounts allegedly operated by his close friend, a musician.

Dmitry Peskov argued that the leaked documents from a Panama-based firm have been wilfully interpreted by an international consortium of investigative journalists to make what he called an unfounded claim that cellist Sergei Roldugin's offshore assets were linked to Putin.

Speaking in an interview today with The Associated Press, Peskov emphasized that "there is not a word about President Putin in those papers," and dismissed the alleged link between Russian owners of offshore assets and Putin as a "product of imagination."

As for British Prime Minister David Cameron, he came under intense pressure today over the Panama Papers leak that said his late father ran an offshore fund which avoided paying tax in Britain for 30 years, but kept mum if some of his family's money is still held offshore.

A major leak of tax documents have claimed that Cameron's late father Ian ran an offshore fund which avoided paying tax in Britain by hiring Bahamanian residents.

Ian Cameron's name is allegedly in the over 11 million leaked documents from the Panama-based law firm Mossack Fonseca that were passed to German newspaper 'Suddeutsche Zeitung' and shared by the International Consortium of Investigative Journalists with 107 media organisations.

According to the Consortium, Ian Cameron used Mossack Fonseca's services to shield profits from his investment fund, Blairmore Holdings Inc, with a series of expensive and complicated arrangements.